The responsibility for the allocation of tax exemptions lies with my colleague, the Minister for Finance. I understand however, that receipt of a payment from my Department would not affect an individual's right to claim the £6,000 tax exemption. Regarding the assessment of such income for social welfare purposes, the various weekly social welfare payments can be broadly divided into two main categories – social insurance payments and means-tested social assistance payments. As social insurance payments are not subject to a means test, any income a claimant may have, including income from renting out a room, would not affect their entitlement to payment. In the case of the social assistance payments, the situation differs between payments. In the case of the old age and widow-er's, non-contributory, pension schemes, any income received in respect of rent from a person who lives with the pensioner is disregarded for means test purposes where, apart from that person, the pensioner lives alone. In the case of an old age pensioner couple, only half of any income which they have is assessed for means test purposes.
In the case of the carer's allowance scheme a single claimant can have weekly income of up to £125 disregarded for means test purposes, while a couple can have up to £250 disregarded. Any further changes in the means-testing arrangements in relation to the assessment of rental income for those claimants not covered by the above disregards would have cost implications and would therefore, have to be considered in a budgetary context.